A Renewable Energy Standard: The Proof Is in the States

Since 2002, Congress has had several opportunities to approve a national renewable energy standard, or RES—requiring that utilities produce a certain portion of electricity from wind, sun, and other renewables—and has faltered each time. Now with the House Energy and Commerce Committee debating and voting on the American Clean Energy and Security Act of 2009, or ACES, H.R. 2454, Congress has another chance. And if lawmakers look at the track record of states that have already adopted RES policies, they should have no hesitation in accepting that part of this energy bill sponsored by Reps. Henry A. Waxman (D-CA) and Edward J. Markey (D-MA).

At the state level, renewable energy standards, also known as renewable portfolio standards, have become increasingly popular. Today, 28 states and the District of Columbia have an RES on the books, and another five states have renewable energy goals that are not mandatory. All but one of these measures has been approved in the last seven years.

Many of those state standards are more stringent than the one outlined in the Waxman-Markey bill, which would establish a 15-percent RES by 2020, with an additional requirement that utilities reduce electricity demand by 5 percent via efficiency measures. Among its benefits would be a substantial reduction in the emission of greenhouse gases because new power needs would be meet by clean wind or sun. A similar bill considered by Congress in 2007 would have reduced carbon dioxide emissions by 100 million metric tons by 2030, according to an analysis by the American Council for an Energy-Efficient Economy. This is comparable to removing 23 million cars from the road.

Conservatives on the Energy and Commerce Committee are expected to push an amendment that would include nuclear power in the definition of renewable energy sources. Only one state, Ohio, allows nuclear to be considered renewable, and if adopted by Congress, that amendment would make a mockery of the national RES.

Nuclear power relies on uranium, a nonrenewable resource that contributes to global warming because mining and processing it requires large amounts of fossil fuels. In addition, nuclear does not make the United States less dependent on other nations, since we import more than 90 percent of the uranium we use. In fact, the United States has only 6 percent of the world’s known uranium reserves. And finally, nuclear is polluting since it produces long-term radioactive wastes.

Based on the experience in many states, a well-designed national RES would also be an economic boon. In just a short time, state renewable standards have proven to be a strong catalyst to development of a robust economic and jobs sector for wind, solar, and other forms of renewable energy. They have helped many states become leaders in the adoption of clean, nonpolluting electric power. And the resulting growth in renewably generated electricity has come with only a nominal rise in electric rates for consumers.

The transition has been so painless that half the states have recently significantly toughened and broadened their requirements and most are on schedule to meet their targets.

Consider the experience of Colorado. In 2004, despite stiff opposition by utilities, Colorado voters approved a ballot measure requiring large power companies to get 10 percent of their electricity from renewable sources by 2015. The state’s largest utility, Xcel Energy, quickly found it could meet that requirement nearly eight years early, so it did an about face and strongly backed legislation in 2007 that doubled the RES to 20 percent by 2020, and added a 10-percent standard for smaller utilities. Xcel expects to meet the 20 percent standard by around 2015—five years early.

With the consumer rebates required by the RES, thousands of Colorado homeowners and businesses have installed solar panels. The state has become a hotbed of what Gov. Bill Ritter (D-CO) calls the “new energy economy.” Wind farms and utility-scale solar projects are sprouting from the eastern plains to the San Luis Valley in southern Colorado. Industry leaders such as Vestas—a Danish wind turbine manufacturer that is investing more than $1 billion in four plants—are setting up shop in the state and hiring thousands of employees. Solar industry giants such as Abengoa Solar have partnered with universities and the city of Aurora to establish the Solar Technology Acceleration Center that when completed will be the largest solar testing facility in the world.

The RES “has been critical” in driving the renewable energy industry in Colorado, said Tom Plant, director of the Governor’s Energy Office. It drove Xcel to solicit bids for 1,000 megawatts of wind, and because it requires a certain percentage of power to be from solar it has expanded the sector that installs small solar photovoltaic systems, or PV, on homes and businesses. Vestas, Plant said, would not agree to commit to building facilities in Colorado until it was sure the state would double the RES to 20 percent. And the incentives and rebates that flow because of the RES, he added, has meant that consumers such as himself pay only about a third of the full price of solar PV.

New Mexico has blazed a similar trail. In 2004 it adopted a 10-percent RES by 2011. Three years later it doubled down to 20 percent by 2020 for large utilities and 10 percent by 2010 for electric co-ops or private, independent electric utilities. Industry in turn has recognized New Mexico as a state that welcomes new energy manufacturing. In 2008 Schott Solar announced it would build a plant to produce modules for concentrated solar facilities, a $100 million investment bringing 350 jobs to the Albuquerque area. Last month, Solar Array Ventures, Inc. announced its intent to build a solar panel manufacturing plant in Bernalillo County that could employ 1,000 workers.

Even a conservative oil state like Texas has a successful RES. Legislation signed into law in 1999 by then-Governor George W. Bush required that the state install 2,000 megawatts of renewable power by 2009. In 2005, the legislature raised the mandate to 5,880 megawatts by 2015, and set a target of 10,000 megawatts by 2025. Today, it is just 562 megawatts short of that 2025 goal and Texas now generates more electricity from wind than any other state—nearly double its closest competitor.

Noted oilman T. Boone Pickens has plans to build a 4,000-megawatt wind farm in Texas, where 2,700 turbines would produce enough power for more than 1 million homes. The project has been slowed by the credit crunch and other market issues, but Pickens is still bullish on wind and a strong supporter of a national RES.

“Congress needs to act now to adopt a national renewable electricity standard in order to create a real long-term commitment to renewable energy in America, creating thousands of good jobs,” Pickens said last month.

Like Colorado, New Mexico, and Texas, other states are also finding that the transition to renewables is achievable enough that they can strengthen requirements adopted earlier. In 2007 alone, Illinois and Maine switched from a voluntary to a mandatory RES, Delaware doubled its RES, while Connecticut, Maryland, and Minnesota increased their RES percentages. The same year, North Carolina became the first southeastern state to have an RES.

To date, not a single state has repealed an RES, according to a Lawrence Berkeley National Laboratory study, and “early-year renewable energy targets in the majority of state [RES] policies have been fully or almost-fully achieved.”

RES policies in the states, concluded the 2007 report, have had “a sizeable impact on new renewable resource development.” Since 2002, more than 60 percent of U.S. renewable power additions have come in states with renewable standards. And that dynamic has only begun to unfold, said the study. “(B)ecause many of these policies have only recently been enacted, and renewable energy contracting has just begun, renewable capacity additions to date do not fully capture the impact of existing state [RES] policies.”

In a separate 2007 study, Lawrence Berkeley looked at more than two dozen analyses of the costs of implementing renewable standards. Its conclusion: Seventy percent of the analyses projected retail electric rate increases of 1 percent or less, and six of them projected cost savings. The median electric bill impact was just 38 cents per month.

Some southeastern legislators are under heavy lobbying pressure from big coal-burning utilities to oppose the national RES in the Waxman-Markey bill. The opponents falsely claim that this region does not have renewable energy potential. But that simply isn’t so. An analysis by the Southern Alliance for Clean Energy found that “the Southeast has the capacity to meet a robust renewable energy standard using sustainably harvested biomass, wind, solar (PV and thermal), landfill gas, and hydroelectric energy.”

If an oil state like Texas can do it, so can other southern states. And the ACES allows states that demonstrate they can’t meet this standard to petition to allow their utilities to reduce their renewable electricity requirement by 3 percent, and increase energy efficiency by the same amount.

The lesson for Congress is obvious. A national RES would expand on the benefits already accruing in many states: more nonpolluting power, a surge in clean-energy jobs, a reduction in carbon emissions, and a brighter future. The House Energy and Commerce Committee can launch a national renewable energy drive by passage of the American Clean Energy and Security Act.